New York — Investors set aside housing market doldrums and rushed to grab shares of real estate website Zillow on Wednesday, valuing the company at as much as $1.6 billion.

Zillow Inc., which has never made a profit, is yet another beneficiary of strong investor demand for the latest crop of Internet stocks. Many of the recent market debutantes provide social networking, online games or search. Zillow's shares tripled in their trading debut on the Nasdaq stock market. Zillow had set a price of $20 for its stock late Tuesday. The shares rose as high as $60 before settling back to close at to $35.77, valuing the Seattle-based company at about $950 million.

The weak housing market did not hurt Zillow's IPO. Figures released Wednesday show that Americans are buying homes at the weakest pace in 14 years.

Zillow's initial public offering follows filings by high-profile Internet companies ranging from daily deals site Groupon Inc., the professional networking service LinkedIn Corp., along with Zynga Inc. best known for the online game "FarmVille." Though these Internet-based companies are generating a lot of IPO euphoria, but the attention they receive on their initial day of trading has not guaranteed success. Pandora Inc., the online radio service, has seen it shares fluctuate wildly since going public on June 14. Pandora's shares are now trading at $17.60, 10 percent above their offer price.

"Investors are very keyed up on business models that integrate the Internet into their main platform and have mobile apps," said David Menlow, the founder and president of research company IPOfinancial. He added that there is also a lot of pent-up demand for promising companies in what's been a stodgy overall market.

Founded in 2004, Zillow provides online listings for more than 100 million homes that are either for sale or for rent. A feature called "Zestimate" helps estimate property values, so that people can see how much homes in their neighborhood_or desired neighborhood— are worth.

The Zestimate has drawn criticism from homeowners across the country who suddenly had the value of their homes — as well as what they bought it for — easily accessible by anyone with an Internet connection. Zillow calculates the figure by taking available data, most of it public, and entering it into a formula that takes into account hundreds of such details as how many bathrooms or bedrooms a home has or where it is located. The site also offers personalized mortgage rates and housing advice. The company has never made a profit, though it grew its revenue 74 percent in 2010, to $30.5 million.

Zillow makes money from advertising, by real estate professionals as well as mortgage companies and brands such as phone or insurance companies. Spencer Rascoff, Zillow's 35-year-old CEO, said the volatile housing market has actually helped the company grow its ad revenue. That's because it accelerated companies' migration to online advertising from higher-priced offline ads in newspapers and elsewhere.

In the first quarter of this year, Zillow's loss narrowed to $826,000 from $2.8 million in the same period a year earlier and revenue doubled to $11.3 million. The company reported a loss of $6.8 million last year.

Though investors are betting on yet-unprofitable companies such as Zillow, experts say the current fever for Web stocks is hardly the bubble of the late 1990s and early 2000s. There are far fewer companies going public, and the ones that do have been around longer and have established business models. That wasn't always the case in the '90s. Menlow said, back then, investors didn't even look at the companies they were snapping up, and only asked "how many shares can I get?". He noted that investors are being more careful these days.

Like LinkedIn, Groupon and Zynga, Zillow is reaping the benefits of being the first to the market, as far as IPOs go, in its niche. This, said Menlow, usually assures a big market share, even if the company's business model isn't all that unique and could be duplicated by a competitor. Internet IPOs are hitting the sweet spot for investors, Menlow said, adding that while he would like to differentiate between the companies, "I don't know if investors are willing to do that at this point."

Whether the company's business model warrants the billion-dollar valuation is another question.

"At this point investors feel they know better than the analysts," Menlow said.

Including a private stock sale of 275,000 shares, Zillow raised $74.7 million in the IPO. That the company offered relatively few shares is another likely reason for its strong market debut.

Also on Wednesday, SkullCandy Inc., the maker of trendy headphones for iPhones and other gadgets, also went public. The company priced its shares at $20. Wednesday afternoon, the stock was trading slightly higher at $20.12 after earlier hitting $23.40.